Olive Garden Seeks to Boost Sagging Sales With Company Makeover

Mike Krumboltz
Yahoo! Finance

Olive Garden has a lock on the “affordable Italian food” market. Or does it? Despite its popularity and 750 restaurants across the country, the chain has lost much of its metaphorical spice in recent years.

A buzzy article from the Chicago Tribune goes into the details. There are several problems the chain is struggling to address. The chain has posted disappointing sales figures for five quarters in a row.

[Darden's Olive Garden needs some spicing up.]

Of course, there's the recession. Thanks to fewer dollars to spend, Americans aren't spending as much on pasta and breadsticks. But some argue the real issues are with the restaurant itself. In the Tribune piece, financial counselor (and Olive Garden customer) Mark Athridge says, “They pour subpar wine and play Dean Martin music and call it an Italian restaurant.” According to the restaurant's official site, Olive Garden is “committed to providing every guest with a genuine Italian dining experience.” Something is getting lost in the translation.

Olive Garden, to its credit, is aware of the disconnect. The executives for parent company Darden Restaurants (which also owns Red Lobster) spoke with analysts last month. Darden president and chief operating officer Drew Madsen commented that Olive Garden has become “a beloved, but somewhat expected brand.”

The question is: What will the restaurant do to change its course? Short answer: A lot. Olive Garden plans to switch up the menu with healthier, low-cost choices. First Lady Michelle Obama praised Darden in September for the restaurant's planned changes to its children’s menu. Obama said, “I believe the changes that Darden will make could impact the health and well-being of an entire generation of young people.”

[Mrs. Obama applauds Olive Garden announcement.]

The first lady's kind words were much welcome. Earlier in 2011, Olive Garden came under fire for accidentally serving booze to toddlers. According to USA  Today, “on March 31, at an Olive Garden in Lakeland, Fla., a 2-year-old was served alcoholic sangria, not orange juice.” Fortunately, the child recovered.

Some have called into question the supposed Tuscan school where Olive Garden trains its chefs. SlashFood quoted someone claiming to be a former employee who had been there. The person claimed that “sporadic 'classes' lasted 'maybe an hour here or there' where they would 'talk about spices or fresh produce for a minute.'”

According to the Chicago Tribune, Olive Garden will also remodel many of its restaurants and plans to launch a new ad campaign. Gone will be the commercials starring eerily happy families waxing about never-ending breadsticks and pasta. In their place will be... well, we don't know. But we'd love to get your ideas. 

What sort of moves do you think Olive Garden needs to make to win back customers? If it's a new menu, what would you like to see on it? If you have ideas for how to lay out or decorate the restaurants, please chime in. If you have thoughts on what sort of ad campaign would work best, let us hear 'em in the comment section below.